IRS 'inadvertently' wiped hard drive Microsoft demanded in audit row

The IRS has declined to produce data in a Freedom of Information Act (FOIA) battle between itself and Microsoft – because the taxmen deleted the information after receiving the information request.

In a filing [PDF] to the US District Court of Western Washington this month, Uncle Sam's Internal Revenue Service said it would be unable to hand over records from a former agent's hard drive. Why? Because the drive had been accidentally wiped by staff unaware of its connection to the case.

Microsoft asked for the drive as part of a larger request for the records of a number of IRS agents, both current and former, connected to dealings with outside law firms aiding in a series of audits of Microsoft. The records in question were of former agent Samuel Maruca.

According to the IRS' story, Maruca's hard drive was believed to have been "wiped and "recycled" within one month after he left the IRS in August of 2014, as is standard protocol for data not involved in litigation. Shortly after, Microsoft filed a FOIA request for Maruca's records.

Believing the data to have been wiped, the IRS did not collect the drive, it said. The information was, however, not deleted until April of 2015 in what apparently was an "inadvertent" blunder. Thus, the IRS says, it can't hand over the data.

Both sides have told the court on Tuesday this week they are still working "in good faith" to find other sources for the requested information.

The FOIA request is part of a larger legal case between Microsoft and the IRS over the tax authority's decision to audit Microsoft with the aid of David Boies, a former US attorney who made his name leading the landmark antitrust suit against Microsoft in the late 1990s.

Microsoft's FOIA seeks information regarding the IRS' decision to hire Boies and other outside attorneys on multi-million dollar contracts rather than use its own staff investigators to audit the company. ®